In late trading, the 10-Year Treasury Note was up by 2-22/32, lowering its yield by 31 basis points to 3.01%; the Dow was down by 444.99 points to 7,552.29; and the Nasdaq was down by 70.30 points to 1,316.12.

Today's economic news was uniformly bearish. The level of initial jobless claims hit a sixteen-year high last week and the level of continuing claims in the preceding week was the highest in almost twenty-six years.

The Index of Leading Economic Indicators fell more than expected last month. Lastly, the Philadelphia Fed Index on the region's manufacturing sector for this month revealed the strongest contraction of activity in eighteen years.

While stocks were hit by the economic data, some support came from talk that a bailout of the auto industry might be at hand. But later word was that a rescue was not assured and that the uncertainty would not be resolved until sometime next month at the earliest.

Oil futures declined again today on the weak economic news that further dimmed demand estimates for the commodity. Though lower prices are an economic stimulant, the reason behind the decline constituted another bearish indicator. The decline also specifically hurts the energy sector of the stock market.

In today's action, the price of a barrel of light, sweet crude oil for next month delivery fell by $4.00 on the New York Mercantile Exchange to settle at $49.62. In the last five sessions, it has fallen by $8.62 and today's close was the lowest for a front-month contract since May of 2005. The contract expired at the end of trading today and the one for January delivery becomes the front-month contract tomorrow.

By the end of stock trading, the Dow had lost 5.56%; the Nasdaq, 5.07%; and the S&P 500, 6.71%. The Dow and Nasdaq closed at their lowest levels since March of 2003 and the S&P 500 closed at its lowest level since April of 1997.

The stock market's loss has been the bond market's gain. In the last five trading sessions, the yield of the benchmark 10-Year Note has fallen by 84 basis points (yield moves inversely to price) and today's close was the lowest in decades. The 30-Year Bond yield closed at 3.49%, 4 basis points lower than where the 10-Year Note yield closed two days ago.

There are no major economic releases slated for tomorrow so technical factors will exert a greater influence on the markets. Today's late drop in stocks will likely send a chill through overseas markets in overnight trading. Whether traders see bargains tomorrow is the question. Bond traders may also be inclined to cash in some of their recent gains but further losses in stocks could extend the rally in Treasuries.

10:30 AM EST : More bad news on the economy has pushed stocks lower and the investment flow is being drawn to the safe haven of the Treasuries market. The rise in bond prices has pulled the yield of the benchmark 10-Year Note down to levels not seen in five years.

All of today's economic releases were worse than expected. In the first release, the Labor Department reported that the seasonally adjusted level of initial claims for state unemployment benefits rose last week by 27,000 to 542,000.

The jump was somewhat of a surprise following an increase of 31,000 the week before (originally 32,000), though last week's figures may have been distorted by the Veteran's Day holiday. Nevertheless, the latest claims level was the highest since July of 1992. The four-week moving average, which smoothes out some short-term volatility, rose by 15,750 last week to 506,500.

Any initial claims reading over 400,000 is considered an indication that layoffs are outpacing hiring and the recent figures suggest that job losses are accelerating. For the forty-six weeks of the year to date, the average weekly reading has been 403,630. For the same period last year, the average was 318,435.

The report said that the level of continuing claims rose by 109,000 to 4.012 million in the week ending November 8 (continuing claims must be at least a week old). This was the highest level since December of 1982. The four-week average rose by 71,250 to 3.867 million. For the first forty-five weeks of the year, the average continuing claims reading has been 3,186,400. For the same period last year, the average was 2,533,222.

Later, the Conference Board, an independent research firm, released its Index of Leading Economic Indicators for last month. The report said that the index fell by 0.8%, a larger contraction than the 0.6% that analysts were predicting. In addition, September's originally reported increase of 0.3% was revised to a rise of just 0.1%. The largest contributors to October's decline were the drop in stock prices, the decline in the rate of building permit issuance, and the pessimistic consumer expectations index.

The news release indicated that the situation has deteriorated over the last twelve months. It said, "Between April and October 2008, the leading index declined 2.4 percent (a -4.7 percent annual rate), falling considerably faster than the 1.2 percent decrease (a -2.3 percent annual rate) over the previous six months. In addition, the weaknesses among the leading indicators have remained widespread in recent months."

The final release of the day and week was the manufacturing index data on the Philadelphia Fed region. It came in at -39.3 this month, down from October's -37.5 and below consensus predictions of a -30.0 reading. Any reading below 0.0 reflects a general contraction of activity relative to the preceding month and the latest reading was the worst since October of 1990. The index has been negative in eleven of the last twelve months with the average reading being -18.6.

The report said that the prices paid index, a gauge of inflation, came in at -30.7, the first negative reading since July of 2003 and the largest in the history of the data series going back to May of 1968 . . . .

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